You have the following demand equation for a pack of cigarettes: Q = 2

You have the following demand equation for a pack of cigarettes: Q = 200 – 0.30P with the average quantity 3 packs and average price $3.00 per pack. What is the price elasticity?

A) 0.30
B) -0.30
C) 1.0
D) -1.0

 

ANSWER

B

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